INTERNATIONAL CURRENCY BUZZ :
- FOREX -Dollar lower against euro, yen before Fed minutes
- FOREX -Aussie falls against greenback in late trade
- FOREX -Yen gains despite weak core manufacturing figures
The pound edged up near two-week highs against the U.S. dollar on Thursday, as markets awaited the Bank of England’s interest rate decision, due later in the trading session. GBP/USD hit 1.5337 during European morning trade, the session high; the pair subsequently consolidated at 1.5330, easing up 0.08%.Cable was likely to find support at 1.5218, Wednesday’s low and resistance at 1.5369, the high of September 23.Later Thursday, the BoE was expected to leave its benchmark interest rate at 0.50% and the level of its monthly asset purchases at £375 billion.Meanwhile, the dollar remained under pressure by diminished expectations for a rate hike by the Fed this year in the wake of last Friday’s unexpectedly weak U.S. jobs report for September.
The USD is falling against the EUR today, as investors awaited minutes of the last Federal Reserve meeting for clues on monetary policy (18:00 GMT). September FOMC meeting was surprisingly dovish and prompted expectations the Federal Reserve might postpone an interest rate to 2016. Fed funds futures currently do not have a 100% pricing in of a fed funds rate hike to 0.25% until February of 2016. We think such opinions are too dovish and still expect a hike in December. However, today’s minutes are likely to be dovish, as they should shed some light on the reasons for delaying a rate hike. The EUR/USD broke above the 1.1289 high on October 5 and psychological level of 1.1300 today.The next key resistance level is the 61.8% of the 1.1460-1.1105 slide at 1.1324 and then the cloud top at 1.1341. Breaking above these levels will open the way to the target of our long position.
- BUY GBP/USD ABOVE 1.5340 TARGET 1.5360 1.5390 SL 1.5310
- SELL GBP/USD BELOW 1.5280 TARGET 1.5260 1.5230 SL 1.5310